Winter 2017 LEADREACHCONNECTand The Official Publication of the Automotive Parts Manufacturers’ Association

“Peace on the Farm,” or “Huge Positive for Canadian Auto”? Unifor’s Labour Agreements and U.S. Elections, Setting up Tectonic Shifts

When Opportunity Training Knocks: How the the Next Automotive Supplier Generation Landscape Could be of Skilled Changing Trades Workers Trumping TPP & NAFTA: The U.S. Behind the Presidential Election Wheel of the Results are in...Now 2017 Honda What? Ridgeline

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INSIDEwhat’s UP FRONT 7 From the Desk of the President of the Automotive Parts Manufacturers’ Association ON THE COVER 10 Unifor-Detroit Three Contracts Give a Vital Boost to Next Generation Auto Investments in Canada FEATURES 14 When Opportunity Knocks: How the Automotive Supplier Landscape Could be Changing 19 There’s Always Room for Improvement 23 Trumping TPP & NAFTA: The U.S. Presidential Election Results are in...Now What? 27 Looking Ahead to Ontario’s and Michigan’s Partnership for Auto Industry Growth and Innovation 29 Bridging the Skilled Trades Gap 32 Think Global, Act Local: Fluid Solutions for the Automotive Industry 34 Automotive Trends & Transactions in Canada IN EVERY ISSUE 38 Leading, Reaching & Connecting: 2016 APMA Highlights on the cover 10 40 Meet APMA’s Newest Members 41 Meet APMA’s Members The industry in which we compete and thrive continues to grow on a global scale. The 42 Meet CAMM’s Members market has become a living organism; a constant pushing and pulling of our boundaries. Behind the Wheel of the All-New 2017 Honda Ridgeline While we are seeing investment in global trade agreements such as the Trans-Pacific 43 Partnership to open up new borders, Canadian suppliers can’t be on constant alert, 46 Service Excellence: APMA’s Three-Pillar Approach hoping for long-term local commitments like the NAFTA to sustain their growth. With a new U.S. President who is focused on tightening up borders, these free trade boundaries may change and could have a huge impact on the industry. 50 BUYER’S GUIDE Find out how the results of the U.S. presidential election could change Canada’s automotive supplier landscape in the informative articles written by Jim Stanford, McMaster University, on page 10; by Joe McCabe, AutoForecast Solutions LLC, on page 14; and by Birgit Matthiesen and David R. Hamill, Arent Fox, on page 23.

Winter 2017 Printed by: Editor-in-Chief Account Executives Matrix Group Publishing Inc. Shannon Savory Andrew Lee, Bonnie Petrovsky, Colleen Lead, Reach & Connect Please return undeliverable [email protected] Bell, Dan Brennan, David MacDonald, Published for: addresses to: Donna Krickovic, Frank Kenyeres, Jeff The Automotive Parts Manufacturers’ 309 Youville Street Senior Editor Cash, Jim Hamilton, Kevin Harris, Krystal Association Winnipeg, MB R2H 2S9 Alexandra Walld Miller, Matt Potts, Renée Kent, Rick Kuzie, 10 Four Seasons Place, Suite 801 Toll free: (866) 999-1299 [email protected] Rob Gibson, Roxanne LaForme, Sandra Toronto, ON M9B 6H7 Toll free fax: (866) 244-2544 Kirby, Thomas Watson, Tylure Lincoln Tel: (416) 620-4220 Finance/Administration www.matrixgroupinc.net Pat Andress, Nathan Redekop, Lloyd Fax: (416) 620-9730 Canada Post Mail Publications Agreement Advertising Design www.apma.ca Weinberg James Robinson Number: 40609661 [email protected] The articles presented in Disclaimer: President & CEO Director of Circulation & Distribution Layout & Design this publication represent the opinions Jack Andress Lloyd Weinberg Kayti Taylor of the authors and the interviewees. [email protected] Their inclusion does not directly or ©2017 Matrix Group Publishing Inc. All rights Operations Manager reserved. Contents may not be reproduced by implicitly denote concurrence or support Shoshana Weinberg Sales Manager any means, in whole or in part, without prior by the Automotive Parts Manufacturers’ [email protected] Neil Gottfred written permission of the publisher. The opinions Association. Articles were reviewed by expressed in this publication are not necessarily APMA staff and selected for inclusion Publishers Sales Team Leader those of Matrix Group Publishing Inc. as they represent issues of interest to Peter Schulz Brian MacIntyre professionals in our industry. Jessica Potter

The Automotive Parts Manufacturers’ Association  5

UP FRONT From the Desk of the President of the Automotive Parts Manufacturers’ Association

his past year was an important one We continue to build our public affairs prac- for our industry, for you our readers, tice with your support. Frequent and expansive and for the Automotive Parts Manu- lead-story coverage on the Business News Net- Tfacturers’ Association (APMA). With work, Bloomberg TV, CBC and CTV has enabled North American volumes at or near record us to affect changes that matter on climate highs and new players entering the market, the change, trade and investment attraction, cost supplier sector is as busy as it has ever been. competitiveness factors and business succession The Canadian automotive sector held its own, planning. Continuous strategic coverage in the and the key OEM players recommitted to the Globe and Mail, the National Post, the New York manufacturing bread-basket of Southwestern Times, the Wall Street Journal, Automotive News, Ontario in spite of what some analysts thought the Detroit Free Press, the Japan Times, the Guard- would be a risk of closure. ian, Inside U.S. Trade and Just-Auto have helped The APMA has worked hard for the sector to elevate the supply sector as the face of the Flavio Volpe in an effort to support the case that Canadian automotive industry in Canada. President manufacturing is a competitive and profitable This upcoming year will bring new opportuni- Automotive Parts Manufacturers’ Association venture. In addition to hosting the biggest and ties as APMA partners with the Ontario Centres most successful annual conference we have of Excellence to deliver to you the $5M Auto- ever held in Windsor this past June, we also motive Supplier Competitiveness Improvement added two major events in automotive technol- Program. We advocated for this tool to help sup- ogy—in Toronto at the Canadian International pliers invest in new software, hardware, training AutoShow in February and in Waterloo with the and mentoring for systems geared to improving Waterloo Region Economic Development Cor- productivity, competitiveness and innovation. poration in September. Those events brought We are the lead partner in making sure you over 1,000 attendees together with customers, access this tool, and we are the entry point for government, opinion leaders and media to talk new applications. about future products and technology and our The recent U.S. election raises a variety ques- industry. tions, and the new Administration’s platform may Our continued collaborative efforts with the drive changes in how you do business with our Canadian Association of Mold Makers (CAMM) customers, especially within the NAFTA region. in Canada, the Original Equipment Suppliers APMA will advocate for the sector in a potential Association / Motor and Equipment Manufac- NAFTA revision, a TPP ratification, on foreign turers Association in the U.S., and the Industría direct investment, in cross-border skilled worker Nacional de Autopartes in Mexico on cross- mobility and shortage discussions, on temporary The recent U.S. promotion of membership and industry sectorial foreign workers and new taxation, on climate election raises a issues took us to speak to legislators in Wash- change initiatives, or any other issue of impor- variety questions, ington, DC, Mexico City, and Ottawa about tance to you and the wider Canadian economy. the defense of the underlying principles of the Now is the time to be engaged with your repre- and the new North American Free Trade Agreement (NAFTA) sentative voice, APMA, on matters that concern Administration’s and an equitable ratification of the Trans-Pacific you most, so that we lead discussions to benefit platform may drive Partnership (TPP). The APMA continues to build your interests. changes in how you its podium as the lead advocate for a Canada/ Our office exists to serve our members and do business with our U.S./Mexico supplier-specific trade position and I invite you to call the APMA if we can be of customers, especially we have built a sought-after voice in matters service to you at any time. Our team is commit- that affect our members. Our member com- ted to meeting our members and speaking with within the NAFTA mittees, including the Small and Medium-Sized you on a daily basis. We are committed to driv- region. Enterprises Committee, are geared to listening ing up and down the same highways your parts to you and championing your causes where they travel on to come and meet you where you do need to be carried. business. Please feel free to continued on 8

The Automotive Parts Manufacturers’ Association  7 call me to arrange for a visit—we will be grateful for the opportunity to learn and to share. I look forward to a continued and fruit- ful relationship with you and to a strong 2017. ■

Regards,

Flavio Volpe President Automotive Parts Manufacturers’ Association

Representing Your Industry The Automotive Parts Manufac- turers’ Association (APMA) is Cana- da’s national association representing OEM producers of parts, equipment, tools, supplies and services for the worldwide automotive industry. APMA obtains its direction through a board of directors, whose 18 mem- bers are leaders in the industry. New members are elected to the board annually by the membership to pro- vide a continuous focus on the inter- ests of the membership in particular and on the industry in general.

8  www.apma.ca Winter 2017 UP FRONT APMA’s Board of Directors Barry Jones Keith Henry Derrick Phelps Steve Wilkins Chairman, APMA President President Director President Windsor Mold Group ABC Group Production, Brose North America Leggett & Platt Automotive Group 444 Hanna Street East 2 Norelco Drive Brose North America, Inc. North America Windsor, ON N8X 2N4 Toronto, ON M9L 2X6 3933 Automation Avenue Schukra of North America Ltd. Tel: (519) 258-3211 Tel: (416) 747-2955 Auburn Hills, MI, USA 48326 360 Silver Creek Industrial Drive Fax: (519) 258-2473 Fax: (416) 246-1997 Tel: (248) 339-4620 R. R. #1, Tecumseh Fax: (248) 339-5290 Lakeshore, ON N8N 4Y3 Earl Hughson Jonathon Rodzik Tel: (519) 727-7004 President Corporate Sales Manager TBA Fax: (519) 727-7091 Invotek Electronics Inc. The Narmco Group QNX Software Systems Ltd. 19 Ing Court 2575 Airport Road 1001 Farrar Road Flavio Volpe Aurora, ON L4G 0K5 Windsor, ON N8W 1Z4 Kanata, ON K2K 1Y5 President Tel: (416) 569-0697 Tel: (519) 969-3351 Tel: (613) 591-0931 APMA Fax: (416) 321-8823 Fax: (519) 969-8559 Fax: (613) 271-9349 10 Four Seasons Place, Suite 801 Toronto, ON M9B 6H7 Peter LeBlanc Frank Seguin CAMM Representatives on the Tel: (416) 620-4220 Director, Automotive Sales, NAFTA Executive Vice-President, Corporate APMA Board Fax: (416) 620-9730 ArcelorMittal Dofasco Projects and Strategy Development Jon Azzopardi PO Box 2460 Magna Closures Inc. President Lisa Boulton 1330 Burlington Street East Corporate Headquarters Laval International General Counsel Hamilton, ON L8N 3J5 337 Magna Drive 4965 8th Concession Road AGS Automotive Systems Tel: (905) 548-7200 Aurora, ON L4G 7K1 R.R. #3 200 Yorkland Boulevard, Suite 800 Fax: (905) 548-4880 Tel: (905) 726-7061 Maidstone, ON N0R 1K0 Toronto, ON M2J 5C1 Fax: (905) 726-7164 Martin Mazza Tel: (519) 737-1323 Tel: (416) 431-8721 Fax: (519) 737-1747 Fax: (416) 431-8758 Senior Vice-President, Roy Verstraete Marketing & Global Sales Executive Consultant / Advisor Mike Bilton Fred Di Tosto The Woodbridge Group Anchor Danly Advanced Engineering Manager CFO 4240 Sherwoodtowne Boulevard 2590 Ouellette Avenue Plasman Group Martinrea International Inc. Mississauga, ON L4Z 2G6 Windsor, ON N8X 1L7 5245 Burke Street 3210 Langstaff Road Tel: (905) 896-3882 Tel: (313) 888-1388 Windsor, ON N9A 6J3 Vaughan, ON L4K 5B2 Fax: (905) 949-6119 Fax: (519) 972-6862 Tel: (519) 737-6984 Tel: (416) 749-0314 Fax: (519) 737-9366 Fax: (905) 264-0574 Ken McDougall Greg Walton Group President President & CEO Linamar Corporation Dynaplas Ltd. 545 Elmire Road North 380 Passmore Avenue Guelph, ON N1K 1C2 Scarborough, ON M1V 4B4 Tel: (226) 326-0115 Tel: (416) 293-3855 Fax: (519) 822-7173 Fax: (416) 293-2684

S tay Connected with APMA! APMA Contact Information

It’s now easier than ever. With Twitter: Another social General Inquiries Vince Guglielmo today’s age of mobile technology and medium for you to stay con- 10 Four Seasons Place, Vice-President social media, there are more ways than nected with APMA. Check in Suite 801 Ext.: 233 Toronto, ON M9B 6H7 E-mail: [email protected] ever before to stay connected with the from home or on the go with your Tel: (905) 620-4220 people and organizations that matter smartphone (@APMACanada)! Fax: (905) 620-9730 Nadia Nincevic to you most. Take advantage of these www.apma.ca Director Stakeholder Relations [email protected] and Corporate Membership opportunities to stay connected with LinkedIn: Social network- Ext.: 224 APMA and have your voice heard! ing, the professional way. Flavio Volpe E-mail: [email protected] Keep connected with APMA President Glenda Tedesco APMA WEBSITE: Read along through our LinkedIn group and get Ext.: 228 E-mail: [email protected] Administrative Assistant as APMA and industry experts the same great updates in a more pro- Ext.: 223 post updates on APMA’s web- fessional setting than other social Janet Soutar E-mail: [email protected] site about current issues affecting the mediums (search for Automotive Executive Assistant Ext.: 227 automotive industry. Everything from Parts Manufacturers’ Association E-mail: [email protected] environmental issues to international (APMA) – Canada). business dilemmas is covered in this APMA is Canada’s national association representing OEM producers space. Visit www.apma.ca. Join the discussion now! of parts, equipment, tools, supplies and services for the worldwide automotive industry. To learn more about the association, its mis- sion and values, leadership and more, go to www.apma.ca.

The Automotive Parts Manufacturers’ Association  9 on the cOVER Unifor-Detroit Three Contracts Give a Vital Boost to Next Generation Auto Investments in Canada By Jim Stanford, McMaster University

Nothing comes easy in the automotive industry these traditional labour cost advantage relative to U.S. plants days. Global OEMs face relentless competition for mar- has reappeared. kets and margins and constant pressure from financial Nevertheless, despite these positives, Canada markets for maximum short-run results. And the com- has not attracted enough OEM investment in recent petition among jurisdictions to catch a share of scarce years to retain our existing assembly and powertrain OEM investment spending becomes more intense every footprint, let alone grow it. Canada won less than five year. Every tool in the toolbox is thrown by governments per cent of new OEM investment announcements in into this competition, from direct investment subsidies North America in the last two years (see table). That’s and tax abatements, to support for training and infra- not sufficient to support our current share of total structure, to leveraging technology networks and skilled North American assembly, which is already down from workers. 17 per cent in 2010, to less than 13 per cent last year. In recent years, although Canada has so much to This was the daunting outlook that Unifor con- offer the automotive industry, we’ve clearly come out fronted as it entered its 2016 contract talks with the Non the short end of this investment competition. We’ve Detroit Three OEMs. And the union certainly took the been sideswiped by the rush of investment toward bull by the horns: it identified winning new investment Mexico. Canada was also hurt by uncertainty about exchange rates, one-way international trade patterns, and weaknesses in the Canadian investment support model—especially the federal government’s ineffective loans-based approach. On the positive side, the Canadian industry continued to demonstrate superior productivity and quality results. Output per worker in assem- bly remains 10 to 15 per cent higher than U.S. levels, and Canadian-made vehicles continue to win a disproportionate share of qual- ity awards from J.D. Power and other agencies. Moreover, with the Canadian dollar retreating to a traditional and more appropri- ate trading range, Canada’s Unifor-Detroit Three Contracts Give a Vital Boost to Next Generation Auto Investments in Canada

Table 1 confirmed major commitments since 2012: a total of Talks went over $4 billion across the three locations, and new-gen- North American Auto Investments down to the eration product mandates for each. Importantly, each deadline at (by announced year, $US) plant also hired significant numbers of new employees: each company. 2,000 in Oakville, over 1,000 in Windsor, and several 2014 2015 But in the end, hundred in Ingersoll. That marked the first major new U.S. $10.5B $29.3B hiring by these companies in Canada in the last 15 years. each committed Mexico $7.0B $4.5B A key factor behind those success stories was a to an explicit ground-breaking new hire, grow-in program negotiated program of Canada $750M $1.5B by Unifor in 2012. At that time, Unifor had been under Canadian Source: Center for Automotive Research. Based on public fierce pressure from the OEMs to accept a permanent investments. announcements not actual spending. Year indicates time of “two-tier” wage structure, similar to one that has been announcement, not of investment. US 2015 total includes in place in the U.S. since 2007. The union rejected the UAW-related announcements. idea of a permanent wage division between new hires and traditional employees. Instead, it proposed an as its top bargaining priority. Audaciously, the union extended grow-in by which an unlimited number of new informed the companies—General Motors (GM), Ford, employees would work their way up to the top wage and Fiat Chrysler Automobiles (FCA)—that no agree- over 10 years. The union argued this system was prefer- ment would be possible without investment commit- able to the two-tier model: delivering large cost savings ments from each. up front, while avoiding the disunity and disruption that This focus on investment was reinforced by an was already hampering some U.S. operations. The suc- extensive education and consultation process with the cess of the Canadian model actually inspired U.S. nego- union’s members. In addition to the traditional compen- tiators (from the United Auto Workers and the OEMs) sation and working condition issues that are the bread- to adopt a similar approach in its most recent contract, and-butter of any bargaining round, local pre-bargain- which eliminated the two-tier system in favour of an ing discussions also focused on the threat of disinvest- extended grow-in. ment and the crises it would cause in auto communities. This time around, Unifor bargainers wanted to see These discussions culminated in a June 1 meeting of some incremental improvements in the grow-in sys- Unifor’s Auto Council, composed of 120 local leaders tem, in particular to ensure new hires received a wage from all three companies. It unanimously agreed that increase every year (rather than having their wages fro- winning new investment must be the union’s top bar- zen for certain periods of the grid). But the union rec- gaining priority. ognized the effectiveness of the system in cementing Three facilities in particular were particularly des- new investments. perate for an investment lifeline. GM’s operations at In essence, then, Unifor’s leaders wielded both a Oshawa, ON had no product assigned to either assem- “carrot” and a “stick.” The carrot consisted of significant bly plant there past 2019. Future product allocations to labour cost savings—and the more the OEMs hired, FCA’s operation in Brampton, ON were in doubt, in part the more they saved. Canadian productivity and qual- because of an ageing paint shop. And Ford’s two engine ity results sweetened the carrot further. The stick con- facilities in Windsor, ON were also desperate for new sisted of the risk of production disruption if the three products, to fill the gap after existing engine programs OEMs did not commit to Canadian investments before phase out. the strike deadline. The union’s strategy was informed by the success Talks went down to the deadline at each company. of three Canadian facilities which had bucked the But in the end, each committed to an explicit program trend and nailed down big new investments despite of Canadian investments. These commitments focused the general southward migration of capital. GM’s facil- on the three most threatened locations (GM Oshawa, ity in Ingersoll, ON, Ford’s Oakville, ON assembly plant, FCA Brampton, and Ford Windsor), but also included and FCA’s Windsor, ON assembly operation had each continued on 13

The Automotive Parts Manufacturers’ Association  11 on the coverUnifor-Detroit Three Contracts Give a Vital Boost to Next Generation Auto Investments in Canada new spending at other locations (including As noted at the beginning of this arti- The benefits of those commitments will St. Catharines, Etobicoke, and Oakville). A cle, nothing comes easy in the automotive be shared not just by Unifor members and total of $1.6 billion in new capital spending industry these days, and the Unifor-Detroit their families, but by all other stakeholders was negotiated across the three companies. Three 2016 contracts fully reflect this in the Canadian industry, including suppli- The compensation features of the new rough-and-tumble economic environment. ers, governments, and auto communities. deal were tailored to reinforce the case for But, despite the hard trade-offs, the out- Most importantly, the bargainers on both new investment. Senior workers receive come is a huge positive for Canadian auto- sides showed that this vital industry can base wage increases of two per cent in the motive production. The union was able to indeed have a bright future in Canada. ■ first and last years of the four-year deal. hold the OEMs’ feet to the fire, in some Those are the first base wage increases ways more effectively even than govern- Jim Stanford is the Harold Innis Industry Profes- since 2007. Compensation gains are also ments can, extracting new commitments sor of Economics at McMaster University and is a delivered through signing and annual to Canadian investment and production. former Economist at Unifor. bonuses, totaling $12,000 for each senior worker. The new hire wage grid was enhanced significantly, with immediate wage increas- es of up to 11 per cent for workers in pro- gression, and new hires will now receive wage increases of between four and eight percent each year until they reach the top. One especially difficult trade-off for Uni- for was a full defined-contribution pen- sion plan for future new hires, replacing the “hybrid” DC-DB plan it first negotiated when the new hire system was implement- ed in 2012. This reflected intense pressure from the OEMs (led by GM on this issue) to eliminate exposure to new DB liabilities of any kind. The agreements were ratified by Unifor members at all three companies, and hence negotiations were once again completed without a work stoppage, continuing an unbroken streak that now stretches back 20 years. This did not come without debate inside Unifor workplaces: some members, after a long, hard decade of wage restraint, wanted bigger wage increases, and the shift to a full DB pension was tough for everyone in the union. But the union’s national and local leadership, backed by a strong majority of members, recognized that investment is the top priority, and understood the difficult trade-offs that this forward-looking focus entailed. All-in labour costs will likely hover in the mid-$50s range through the four years of this contract, especially as the companies move ahead with more new hiring, which pulls down average costs through the grow-in system. That will cement a Cana- dian labour cost advantage, relative to U.S. operations—where all-in labour costs in most Detroit Three locations are $60 and rising—and reinforces the case for subse- quent Canadian investments.

The Automotive Parts Manufacturers’ Association  13 Feature When Opportunity Knocks: How the Automotive Supplier Landscape Could be Changing By Joe McCabe, AutoForecast Solutions LLC

As we come to the end of another year, 2016 does not for the life of the contract, viewed as an absolute disappoint, in terms of excitement in the automotive win for labour. space. This year has demonstrated how the industry in But, in terms of a new Canadian automotive which we compete and thrive continues to grow on a footprint being solidified for the long-term, the global scale. The market has become a living organism; deals mostly came up short. As Sergio Marchionne a constant pushing and pulling of our boundaries. stated during the conference call to discuss FCA’s We are seeing investment in global trade agree- third quarter profits, “it buys us peace on the farm ments such as the Trans-Pacific Partnership to open up for the next four years.” Investment in a paint shop new borders, while being countered by a desire to close (Brampton, ON) and overflow assembly of pick-up borders through the United Kingdom’s Brexit. There is trucks (Oshawa, ON) are excellent in their own right anticipation for China to slow, in terms of growth coun- and should demonstrate a long-term willingness to tered, by 2016 results expected to exceed 2015. And commit to the Canadian space. markets are expanding to the point where the source Intentions and hard commitments are different. of the vehicle’s production is becoming less and less Ford, with its plan in an all new engine program in Aimportant to the consumer. Windsor, ON demonstrates its willingness for long- This constant volatility, which is not expected to term investment—but not without a valid threat to end anytime soon, provides a very interesting space move all Ford Edge export production to China. For in which suppliers can compete. Suppliers will need to the time being, the more than $1.5-billion combined become as flexible as their customer base and nimble investment from the vehicle manufacturers—with an enough to remain competitive since these activities will expectation of an additional 20 per cent from the only accelerate as we move forward. local and federal governments—are shining stars in One area of particular interest this year was the negotiations that could have gone either way. Unifor labour negotiations in Canada. In October and But, that is today. Canadian suppliers can take early November, Unifor began an aggressive push in the a breath—but only a brief one. Let’s take a look at Suppliers will Detroit Three. Unifor had three main goals to achieve the Canadian automotive manufacturing footprint, need to become with each vehicle manufacturer: before and after the negotiations (see Figure 1). as flexible as • Job/wage security; The results are interesting. From a production • Investment; and volume outlook perspective, very little was achieved, their customer • New product commitment. with a net annual increase of less than $200,000 base and Of the three goals, Unifor was mostly successful. per year across all three manufacturers. The plant nimble enough Each negotiation came down to an 11th hour decision, investments indicate a higher potential for new to remain with both parties believing they won in the deal. Each product after 2020, but none was specifically called competitive contender had something to lose and something to out or even put on the table. A new paint shop at since these gain. In a positive market, the investment each vehicle Brampton indicates new product (which we are fore- manufacturer put into the people and future of their casting to be an updated platform for the Charger activities will plants turned out to be the cost of doing business. They and Challenger that would also be flexible enough only accelerate could not afford to lose one day of sales of their profit- for a new crossover), but not solidified during nego- as we move able Pacifica, Equinox, or Edge, so each vehicle manu- tiations. The Oshawa assembly investment sets the forward. facturer came to the table with money and job security groundwork for full assembly of GM pick-ups, but no

14  www.apma.ca Winter 2017 When Opportunity Knocks:

commitments were made at this time. And Windsor getting more engine investment is important, but not the ground-breaking volumes we were hop- ing for, which would have resulted if they put their EcoBoost engine there instead. While job security, wage increases, and hundreds of millions of dollars of investment are a great start, it still places Canada in a wait-and-see position for the future. So, what needs to be done? Canadian suppliers can’t be on constant alert, hoping for these long- term local commitments to sustain their growth. They need to continue to look outward from their local markets, including outside the North Ameri- can Free Trade Agreement (NAFTA). And now with a new U.S. President who is focused on tightening Figure 1 up borders, even these free trade boundaries may change. In the past, vehicle manufacturers would con- solidate vehicles into million-unit platforms. Now, they are consolidating into multi-million unit vehicle architecture. These architectures are not all rooted in the NAFTA, opening up large battle fronts of competition from other jurisdictions and their supply base. This isn’t just the argument of how to compete differently with vehicle migra- tion to Mexico—this is a global issue. An example of this new competitive front is demonstrated with the Volkswagen MPB architecture, which will even- tually underpin over 10 million cars per year, with lead countries in Europe. Another is the Vehicle Set Strategy architecture concept from GM, which will be the basis for four major platform designs for nearly all of their future models. These architectures continued on 17 Figure 2

The Automotive Parts Manufacturers’ Association  15 featureWhen Opportunity Knocks: How the Automotive Supplier Landscape Could be Changing and other examples shown in Figure 2 reach these goals in an accelerated time- It is not just about waiting for the represent a migration of volume growth. frame. This opens the door for the right RFQs to show up at the doorstep. It is For example, the GMT900 Truck platform suppliers who can provide innovation in about bringing your best ideas forward; was introduced with over one million units the form of product, processes, delivery, guiding the customer to what could be of annual production. Once considered and execution. These suppliers need to be the next big thing. Competitiveness in unheard of, now that platform isn’t even in nimble enough to adapt to the customer, the future will be defined by a supplier’s the list of top 10 volume platforms today. market/consumer demands, environmental willingness to cross boundaries, take To remain competitive, vehicle manu- issues, government oversight, and quick risks, innovate, and understand the ever- facturers are attempting to increase mar- changing global automotive climate. This changing automotive space by identify- gins through part commonality, innova- can only be accomplished by understanding ing the opportunities and striking while tion, and overall economies of scale. This the opportunities that lie ahead and devel- the iron is hot. If not, then your compe- is not an organic process. It requires the oping a forward-thinking, team-like busi- tition will ultimately determine your fate input from the supplier community to ness model with the vehicle manufacturers. for you. ■

The Automotive Parts Manufacturers’ Association  17

By Warren Ali, Automotive Parts Manufacturers’ Association T he APMA Connected Lexus ready for Feature testing at its demonstration project in the City of Stratford.

There’s Always Room for Improvement The Automotive Parts Manufacturers’ Association In order to remain competitive, Ontario’s auto sec- (APMA) has a long and storied history of being the tor continues to invest in critical aspects of its opera- voice for Canada’s OEM producers of parts, equip- tions, like the people, processes and research and ment, tools, supplies and services. A lot has changed development. But it is well known that these com- since its founding over 60 years ago—both in the panies operate on thin margins and, as such, there is industry as a whole and in the make-up of vehicles not always room left in annual budgets to invest in themselves. another key component of business: IT. This is espe- The three main drivers behind this change for both cially true for Ontario’s small and medium-sized enter- the present and the future of the auto industry are prises (SMEs). greening, safety and connectivity. These drivers are The APMA has long recognized this issue and fueled by both regulatory requirements, such as high- advocates to all levels of government the need to er fuel efficiency and lower emissions and also con- focus some attention on it. The various levels of gov- sumer demands and trends. Not surprisingly, these ernment have worked on addressing the needs of the drivers also present tremendous business develop- OEMs and the larger Tier 1 companies, but more work Tment potential. needs to be done with the SMEs, which have a lot of Innovation at all levels of the supply chain plays potential for both economic and job growth. an important role in ensuring that regulatory require- The Government of Ontario responded to the “To drive ments are met (if not surpassed) and that consumer APMA’s call to action, and in March 2016, it announced economic demands are satisfied. Innovation will also be a key the funding of the Automotive Supplier Competitive- driver behind improving productivity and overall com- ness Improvement Program (ASCIP). ASCIP is a two- growth, petitiveness. More than ever, this increasing innova- year, $5 million program funded through the Minis- Ontario tion challenge is being faced by Ontario’s machining, try of Economic Development and Growth (MEDG). businesses tool, die and mould-making companies (MTDM) as ASCIP’s objective is to provide funding assistance for need to take well as its Tier 1, 2 and 3 companies. SME IT investment in software, hardware and training. their firms Addressing the challenge of constant innovation It is aimed to help SME auto parts companies increase to the next for any auto company starts right on the shop floor. their productivity, adapt quickly to market changes Innovation requires these companies to be lean, high- and take advantage of new opportunities with larger level and ly productive and efficient. After the near “Carpoca- manufacturers. embrace the lypse” of 2009, Ontario’s MTDM and auto suppliers ASCIP is a first-of-its-kind program and its unique- technologies of have rebounded. Order books are at near capacity and ness is further enhanced as it marks the first time that tomorrow.” business is doing well. continued on 21

The Automotive Parts Manufacturers’ Association  19 featureThere’s Always Room for Improvement

Flavio Volpe, APMA president, speaking at the ASCIP announcement at APMA Member Dynaplas Ltd.’s plant in Scarborough. From left: Greg Walton, president and CEO of Dynaplas Ltd.; Charles Sousa, Minister of Finance; Baz Balkissoon, former MPP for Scarborough Rouge-River; and Brad Duguid, Minister of Economic Development and Growth.

APMA Connected Vehicle members Sam Alesio, managing director of Tyco Electronics Canada (far right), and Sherry Shannon- Vanstone, president and CEO of TrustPoint Innovation Technologies Ltd., are leading the CVAV discussion at the inaugural AutoTech Symposium.

20  www.apma.ca Winter 2017 the Ontario government has partnered “For Ontario, the benefits of being part vehicles, but a lot of the value and busi- with the APMA to deliver a funding pro- of automated vehicle innovation are clear. ness benefits that they’re going to real- gram. The APMA is the industry facing In order to compete, Ontario needs to be ize isn’t necessarily going to be in metal lead on ASCIP and is the gateway for inter- consistent with the approach of U.S. juris- bending; it’s going to be in the services ested applicants to enter the program. The dictions,” said Minister Del Duca. they can provide on that platform in the online application portal and process is Minister Duguid added that “[we] vehicle,” says Grant Courville, senior managed by the Ontario Centres of Excel- intend to be leaders in this disruptive director of product management for QNX lence (OCE). The first application intake technology.” Software Systems. windows have seen significant interest, The sentiments of these ministers The APMA will continue to push for so there is no doubting the popularity of are echoed by Ontario’s CVAV industry the advancement and success of Cana- ASCIP. leaders. da’s world-leading auto supply compa- Ministry of Economic Development and “Auto makers are realizing that their nies, both traditional and emerging ones Growth Minister Brad Duguid and Min- future is going to obviously lie in building alike. ■ ister of Finance Charles Sousa, alongside APMA President Flavio Volpe, made an announcement at APMA Member Dynap- las Ltd.’s facility in Scarborough, ON. “To drive economic growth, Ontario businesses need to take their firms to the next level and embrace the technolo- gies of tomorrow. By lowering the cost of doing business, helping more companies to scale up, and supporting innovation, we’ll produce global frontrunners that lead technological disruption and position Ontario to win the jobs and investments of the future,” said Minister Duguid at the announcement. In keeping with the theme of jobs and investments of the future, the APMA is moving forward with its initiatives directed at demonstrating Ontario’s expertise in the fast-growing connected vehicle / autono- mous vehicle (CVAV) sector. Building on its highly successful industry collaboration on its Ontario-built Connected Lexus 350 platform, the APMA is now leading a new rolling demonstration with its forward- thinking infrastructure partner, the City of Stratford. Working with three of its CVAV mem- bers, Carnegie Technologies (Pravala Networks), Misyren and TrustPoint Inno- vations, the APMA is working on a dem- onstration project that will test the Con- nected Lexus using the advance connect- ed infrastructure on the roads of the City of Stratford. This demonstration project is forming the basis for a larger and more robust industry and technology demon- stration proposal. In October 2015, Ontario Minister of Transportation Steven Del Duca and Minister Duguid announced that Ontario would allow for the testing of CVAVs on its roads starting January 1, 2016.

The Automotive Parts Manufacturers’ Association  21

Feature By Birgit Matthiesen & David R. Hamill, Arent Fox LLP Trumping TPP & NAFTA: The U.S. Presidential Election Results are in...Now What? How the U.S. presidential election will affect the Trans-Pacific Partnership and the NAFTA Agreement.

“If Americans want to talk about NAFTA, I’m more than happy to talk about it.” —Canadian Prime Minister Justin Trudeau, November 10, 2016

The new President will also know that he has great leeway. In a 2016 study by the Peterson Institute for International Economics entitled Assessing Trade Agen- das in the U.S. Presidential Campaign, the authors note The Prime Minister made this surprising statement the transfer of trade authority over recent decades a mere two days after the U.S. elections. A few days from the Legislative Branch to the Executive Branch. later, Mexico City offered the same gesture. Can the President go it alone? “The question arises Why so soon is anyone’s guess, but this surely was whether a President Trump could unilaterally carry out very good news for Donald J. Trump. his [campaign threats on trade]. The short answer, at Here in Washington, President-elect Donald least in the short-term, is ‘yes.’” Trump will now want to act quickly given that “ripping The three North American leaders are likely to up” the NAFTA was one of his central campaign prom- meet soon to dust off the NAFTA and re-write the ises. Building a wall along the Mexican border will take rules that have been the playbook for the world’s time. Repealing the Affordable Care Act will run into most successful integration of industry sectors. tactical delays in Congress. This is why company executives now realize that Now, Ottawa and Mexico City have handed him a trade policy is no longer a “when it happens” problem. potential early “win.” continued on 24

T The Automotive Parts Manufacturers’ Association 23  featureTrumping TPP & NAFTA: The U.S. Presidential Election Results are in...Now What?

In anticipation of NAFTA 2.0, compa- for goods to be re-exported to another Canada to begin to take full stock of their nies need to give their shareholders some NAFTA party as long as the re-exporta- North American supply chain and cus- assurance that their cross-border interests tion is a condition of duty waiver. This tomer base. They will need to reacquaint will be protected. Some are appreciat- provision is viewed by many as most dis- their key employees, including in-house ing the consequences already—our firm advantageous to U.S. exports to Canada counsel and financial executives, with the has received calls from senior executives and Mexico. Opening up NAFTA could current NAFTA rules they have depended inquiring about their company’s potential eliminate this provision (the Trans- upon since 1994. They will want to assess risk exposure now that the ground has Pacific Partnership (TPP) did not contain their risk exposure and decide how best dramatically shifted. similar restrictions), which could lead to to position themselves in a new North To that end, we offer our readers some duty breaks for exports of U.S. automo- American trade landscape. potential landmines if NAFTA becomes tive parts into Canada that are not cur- While a “wait and see” approach for fair game for change in 2017, which could rently permissible under the NAFTA. TPP may have made sense last year, the include: unpredictability in a post-TPP world does • The U.S. Merchandise Processing Fee: Beyond NAFTA not afford the same luxury this year. Div- Currently, the United States imposes NAFTA could be the tip of the iceberg ing into the details of how your com- this ad valorem “border fee” on every for the new Administration’s trade agenda. pany currently benefits from NAFTA and commercial import transaction with the While President-elect Trump is clearly no what would happen if it were taken away exception of NAFTA qualifying ship- fan of the TPP, don’t expect free trade to are actionable items that would wisely ments. Abolishing NAFTA would mean be dead in the United States quite yet. New be incorporated into current strategic abolishing this very important cost U.S. bilateral and multilateral free trade initiatives. advantage to Canadian companies. agreements with strong enforcement pro- An evaluation of the potential impact • NAFTA “Accumulation Rules”: This visions are a distinct possibility, especially if on your company of likely future U.S. has allowed companies in Canada to they address many of the same U.S. geopo- trade policies will provide CEOs with the effectively reduce the “non-originat- litical concerns that the TPP does. tools needed to build their competitive ing” value of materials used in the pro- Other likely actions that will be taken advantage for years to come. ■ duction of their goods destined to the by the Administration in the trade area will United States or Mexico. Any means to be measures aimed at getting tough with Birgit Matthiesen and David Hamill co-chair the qualify goods using inputs outside of China. Whether or not President-elect Canada-U.S. Cross Border Business Affairs prac- North America could be viewed by the Trump will live up to his campaign promise tice at Arent Fox LLP in Washington D.C. Birgit Trump Administration as “loopholes” to raise tariffs on Chinese imports to 45 is a well-known voice for Canadian business that should be eliminated. per cent, expect heightened enforcement interests in the U.S. and served at the Canadian • NAFTA “Tracing Rules”: Unique to activities by the U.S. Custom and Border Embassy in Washington. David worked in the NAFTA and the automotive industry, Protection to address U.S. trans-shipment Office of General Counsel at the U.S. Department tracing is often assumed as being a concerns at the northern border. High on of Treasury during the U.S. implementation of the drain on qualifying automotive parts this list will be fabricated steel products, NAFTA. Their insights offer automotive compa- under NAFTA. The odd way in which which could conceivably include some nies strategic analysis on how changes in U.S. these rules work sometimes causes automotive parts. law can affect the bottom line. Follow their alerts parts to originate that otherwise would on developments in the U.S., from trade policy not be NAFTA-qualifying. Be prepared to trade enforcement, by going to www.arentfox. • NAFTA Duty Deferral: NAFTA speci- The uncertainty raised by the elec- com/people/birgit-matthiesen and clicking on the fies that parties cannot waive its duties tions should spur automotive companies in Newsroom tab.

24  www.apma.ca Winter 2017

feature Looking Ahead to Ontario’s and Michigan’s Partnership for Auto Industry Growth and Innovation

In August 2016, the Province of Ontario and the investment, jobs and growth on both sides of the State of Michigan announced they are working border.” together to drive growth and increase the com- petitiveness of the Great Lakes auto industry. What a Trump Administration could mean for Ontario Premier Kathleen Wynne and Michi- manufacturing in Canada gan Governor Rick Snyder signed a Memorandum It’s hard to say what a Trump Administration of Understanding (MOU) in Traverse City, MI that could mean for Canada and how the Canada-U.S. will promote auto industry innovation and region- relationship will look moving forward, since we can’t al competitiveness. predict which campaign promises President-elect Ontario and Michigan are two of the lead- Trump will follow through on once he takes office— Quick Facts ing automotive jurisdictions in North America, deporting illegal immigrants, extreme vetting of • In 2015, two-way goods together accounting for over 26 per cent of vehi- Muslims who want to enter the country, or oppos- trade between Ontario cle production in the region. North America’s auto ing trade deals that might prevent “making America and Michigan totalled industry is comprised of regional clusters in the great again.” $74 billion. IGreat Lakes area, southeastern U.S. and Mexico. Scrapping the North American Free Trade • In 2015, over 65 per cent As the leaders of the Great Lakes region, Ontario Agreement (NAFTA)—which President-elect Trump of Ontario’s total global and Michigan benefit from a shared and inte- blames the loss of American manufacturing jobs to trade was conducted with grated supply chain, with parts and completed Mexico on—or pulling out of the Trans-Pacific Part- the U.S.—two-way mer- vehicles moving back and forth across the border. nership and building a wall, both literally and figura- chandise trade totalled The MOU will create a working group to tively, were supported by his followers in industrial more than $340 billion. explore opportunities for increased collaboration states like Michigan, Ohio and Wisconsin. Creating • Ontario is a major market that enhance the competitiveness of both juris- trade barriers could have a detrimental impact on for the U.S.—over 60 per dictions. Potential focus areas include: international trade, manufacturing operations in cent of the merchandise • Technology advancement, including con- Canada, and the U.S. economy. exports from the U.S. to nected cars, autonomous vehicles, lightweight “The challenge for Ontario and Canada’s auto Canada last year were materials and alternative fuels; industry is to make sure the new administration destined for Ontario. • Increased supply chain integration and tech- understands that any protectionist measures against • According to a 2015 nology transfer through business-to-business imports equally affect the profitability of Ameri- BMO report, one-third partnerships; and can companies,” says Flavio Volpe, president of of the economic activity • Best practices in industry strategy, regulatory the Automotive Parts Manufacturers’ Association. in the U.S. and Canada and policy approaches, and workforce skills “We’re so integrated, you can’t supply operations is generated in the Great development. on either side of the border efficiently if that border Lakes–St. Lawrence “Ontario is already a leader in automotive gets thicker.” region, which includes parts and assembly. Increasingly, we are leading in Premier Wynne is concerned about the trade eight states and two automotive innovation as well, particularly in the relationship moving forward, as the U.S. is Ontario’s provinces. In 2015, the fields of information technology and clean tech- most important trading partner, accounting for 80.5 region’s economic output nology. But we can’t take our success for grant- per cent of the province’s exports, but she is also was US$5.8 trillion. ed,” said Kathleen Wynne, Premier of Ontario, at open to the idea of renegotiating the 22-year-old • Michigan’s automo- the signing of the MOU. “North America’s highly NAFTA, as long as the provinces are included in tive employment has competitive auto sector calls on us to work more discussions. increased by over 50 closely with our friends and industry partners in Both Canada and the U.S. have a recognized rela- per cent since 2009 Michigan. By combining our collective strengths tionship of working together on a global scale. Now, (more than 54,000 jobs through this MOU, we will boost regional com- we wait to see how things unfold once President- created). petitiveness and create new opportunities for elect Trump takes office in late January 2017. ■

The Automotive Parts Manufacturers’ Association  27 To advertise in the next issue of Lead, Reach and Connect, call 866-999-1299 or e-mail [email protected].

28  www.apma.ca Winter 2017 Feature By Robert Cattle, Canadian Tooling & Machining Association

Bridging the Skilled Trades Gap

The first intake of the Canadian Tooling & Machining Discussions then began with the CTMA on how they Association’s (CTMA) 32-week Introductory Trades could bring this innovative, industry-driven approach Training program (ITT) started approximately two- forward and make it accessible to all industry partners. and-a-half years ago, but the genesis for the program Now, if we could only find a different way to intro- started long before that. Seeking new ways to attract duce young people to this technology, we might be youth to careers within our industry became one of on to something. the CTMA’s top priorities to help bridge the skilled The CTMA approached Ontario’s Ministry of Eco- trades gap. nomic Development with a proposal to help open “Where do you find the latest, most technically more opportunities for youth and provide employ- advanced machine tools? ers with some funding (say, $8,000.00 per student) “Where do you find the people who can operate to help companies offset some of their shop floor them?” training costs. Screening youth to find those with the These are the kinds of questions that we asked attitude and aptitude to learn skills and succeed in Tour members, and the answer was always, “The tech- the industry was also included in the proposal. With nology and equipment are on our shop floors, but these elements, we thought we might just have a new we don’t have enough skilled people to operate the method of connection—and the Ministry agreed— machines. We would take on more work and buy hence, the ITT Program was born. more machines if we had more trained people.” What started in 2014 as a pilot program that Just like many of our other member companies, hoped to train 25 youth in the Windsor-Essex region Valiant Machine & Tool Inc. was experiencing this has blossomed into a full training program that has same problem and had developed their own train- initiated over 200 new careers. It is now attracting ing centre to combat this issue. They successfully youth from as far away as Sudbury and North Bay trained approximately 140 new employees, who are who are making the move to Windsor in order to now working within their nine Windsor locations. receive this training. continued on 30

The Automotive Parts Manufacturers’ Association  29 featureBridging the Skilled Trades Gap

Why does this program work? Let’s As with all new initiatives, there have have a look at it through two different been some growing pains and some dis- perspectives: youth and employee. appointments along the way but, on the whole, we are achieving a retention rate of Youth perspective approximately 80 per cent and most par- • The program is open to youth aged 18 ticipants are being offered full-time posi- to 29 who are residents of Ontario and tions by their host companies. Another are unemployed or underemployed. demonstrated element of success is that • You will be screened for your level of a large percentage of the graduates have mechanical skills and, above all, the now enrolled in various Ministry of Train- right attitude and aptitude. We are ing, Colleges and Universities apprentice- looking for youth who enjoy work- ship programs. ing with their hands, take pride and Recently, the program has been ownership of what they produce, and expanded to offer a 42-week Earn While would like to work in a “shop” environ- You Learn (EWYL) stream that is attract- ment. If you’re looking for a career and ing youth from all over Ontario. They not “just a job,” then this may be a good are temporarily moving to Windsor and choice for you. training with us full-time at the VTDC. • Once selected, you will be hired by In the EWYL stream, youth learn manual a sponsoring employer and you will machining, CNC machining and CNC pro- receive six weeks of paid preliminary gramming by training 40 hours per week training at the Valiant Training and starting at 7:00 a.m. each day and will be Development Centre (VTDC) starting available for hire upon graduation. As with at 7:00 a.m. each day for 40 hours per the ITT stream, EWYL students receive week. the same tools as described earlier. A key • You will then receive a further 26 element to the success of this stream is weeks of paid shop-floor training from that students learn from making real parts your new employer and this training for real companies, which also brings in a will be monitored by CTMA staff. revenue stream and demonstrates to the • You will also receive $1,500 worth of government that the industry supports tools, including a rolling cabinet with this type of condensed training. We now top box, micrometers, indicators, Allen have a waiting list of candidates who are keys, mallets, and more, all of which ready to participate in future intakes. If you will be yours to keep if you successfully would like more information about the ini- complete the program. tiative, go to www.ctma.com/initiatives/ • Upon graduation, successful youth will introductory-trades-training-program. be offered permanent employment by It has personally been very rewarding their host employers. to grow this program and see it flourish. The following are a few samples of the Employer perspective many comments we have received from • Your company will receive screened participating companies and youth. and assessed candidates who we believe are looking to start a career Youth feedback within our industry—not those who are • “Before this program, I was selling “just looking for a job.” computers making mediocre wages • Your company will receive $8,000 for doing a job that I disliked and felt had each youth participant to help offset no future. Bills were always missed. I your training costs. couldn’t do the things for my family • Progress will be monitored through- that I wanted to do and dreams of buy- out the program to ensure the indus- ing a house were feeling unreachable. try-created “Technical Learning Out- On my first day in class back in April comes” are being achieved. 2015, I knew I was where I needed to • Your company will receive new be—everything about it felt like it was employees who can become valuable a perfect. Now, I am fully employed members of your team—young people doing a job I love and I know I have a you will want to invest in. very bright future.”

30  www.apma.ca Winter 2017 • “Prior to getting into the ITT program, I was living • “The ITT program is providing candidates that A key element on welfare with my spouse, constantly looking for come with a good base. The vetting process is to the success employment when none could be found with my great because they come to us with a better idea of this stream skill set. I now have a career I’m happy with and I of what is expected to enter the field than those is that students love my job. The people around me have been so whom we hire off the street.” helpful and I could never have gotten an oppor- It is quite interesting to see how a private com- learn from making tunity like this if it wasn’t for the CTMA’s ITT pany’s initiative to solve its own issues has grown real parts for real program.” into a solution that can be used by our entire indus- companies, which try. By looking “outside the box,” this new industry- also brings in a Employer feedback driven training alternative is providing the machin- revenue stream • “The ITT program has provided our company with ing, tool, die and mould-making sector with much and demonstrates a hardworking individual who shows eagerness to needed, new skilled employees. Our industry part- learn the trade.” ners, who have donated so much with their “in– to the government • “The program provides strong candidates with kind” support of this program, are now seeing the that the industry which to build the next generation of tradespeople.” benefits from their investments. supports this type • “This program has changed the way that we train The CTMA looks forward to expanding these of condensed because of how progress and outcomes are meas- programs in the future and helping all of its industry training. ured and it has taught us to move new employees partners “Bridge the Skilled Trades Gap.” For more around our shop so they learn more and become information, contact Robert Cattle at rcattle@ctma. valuable employees.” com. ■

The Automotive Parts Manufacturers’ Association  31 feature Think Global, Act Local: Fluid Solutions for the Automotive Industry

Houghton International is the global leader in the and growing their supply positions,” says Bill Schrad- supply of specialty chemicals and services to the er, Houghton Auto Components & Bearings Man- automotive market. Its mission is to build strong ager, Americas. “But simply driving out cost is not relationships with customers and deliver advanced enough. This must be done in parallel with improv- fluid solutions and chemical management services ing the part quality and environmental profile of the to maximize productivity and product quality while chemicals used in the process. These trends are driv- minimizing risks. ing the cross functional work of our research and Houghton promotes innovation and collaboration technology teams to develop products that are up to on global industry-focused teams, while local repre- the challenge.” sentatives develop relationships with customers and Houghton’s HOCUT® 4000 series is an example targeted solutions to optimize their manufacturing of the next generation of high-performance metal performance. removal fluids for the automotive industry. The new Houghton’s long history of serving the automo- platform of water-miscible metal removal fluids Htive industry has led to its development of a range of improves machining and grinding performance, is targeted solutions that can reduce the cost of pro- easier to use and maintain, and has an EHS profile duction, the cost of maintenance and product con- that complies with environmental regulations across sumption while improving productivity. Houghton’s the globe. fluid solutions enable automotive and component “In addition to the step-change in performance, manufacturers to optimize production efficiency the 4000 Series enables our global customers to use with technologies that are compliant with stringent the same product in all international locations with legislation, while delivering exceptional sump life and local sourcing, simplifying their global supply chains,” reducing tool and energy costs. says Schrader. “In today’s market, we understand that now— Another Houghton innovation for the automo- more than ever—driving costs out of the manufactur- tive industry is the launch of new fluid equipment ing process is critical to our customers maintaining solutions that provide manufacturers with signifi- cantly greater control of fluid quality and concen- tration. The Houghton GREENLIGHT™ Continuous Concentration Monitor and the Houghton® ACTS™ Fluid Monitor and Control System provide significant advances in the control of vital water-based metal cutting fluids, cleaners, aqueous quenchants and water glycol hydraulic fluids. Many variables affect the performance of metalworking fluids; however, concentration is usually the most critical in assuring long tool life, achieving tight tolerances, reducing corrosion, improving surface finish and pushing the envelope on productivity. “These exciting innovations are designed to help maintenance and production managers do what they do, only better,” says Schrader. “By automating the process and displaying easy-to-identify visible cues, the operators can keep their systems running within optimal parameters and avoid the excess costs related to mismanaged systems.” Houghton is dedicated to serving the Canadian automotive component manufacturing industry and

32  www.apma.ca Winter 2017 expanded its commitment through the purchase of In addition to Commonwealth Oil (a division of Wallover Oil) in the step-change July 2016. This acquisition expanded Houghton’s in performance, portfolio of solutions, enabling the company to bet- the 4000 Series ter serve the key automotive components sector enables our with a full range of fluid solutions to improve oper- global customers ating performance. Houghton is positioned to help automotive to use the same component manufacturers drive costs out of the product in all manufacturing process through fluid innovations, international best practices, reduced energy costs, increased tool locations with life, increased sump life, reduced waste and other local sourcing, operating improvements that reduce the total cost increase profitability, improve product quality and minimize simplifying their of ownership. ■ risks for modern manufacturers. The company focuses on providing products and solutions to support local, regional global supply Houghton International, based in Valley Forge, PA, operates and global customers, enabling them to maximize efficiency chains. research, manufacturing and office locations in 33 countries and productivity by using advanced fluids from a single global around the world, delivering fluid solutions and services that supplier.

The Automotive Parts Manufacturers’ Association  33 feature By Peter Hatges, KPMG in Canada Automotive Trends and Transactions in Canada Canadian automotive M&A activity GM and Ford ranked third in EBITDA margin perfor- The automotive industry continues to perform mance of 11.1 per cent behind Toyota at 15.6 per cent, strongly. Rationalization of supply, steady production, and BMW at 13.9 per cent. VW, the world’s second larg- and low interest rates have created a sea of black. est car company by sales volume at US$233.6 billion, next to only Toyota at US$269.3 billion, is the only major Strong performance auto maker to incur a net loss which was largely a result Every major automotive original equipment manufac- of the diesel emissions recall.* turer (OEM) has reported strong EBITDA performance *Source: Capital IQ, as of June 30, 2016 on a trailing 12-month basis. The industry is awash in strong profitability with Ford, GM, and Fiat/Chrysler Production growth and robust innovation combining for EBITDA of US$43.3 billion. Toyota tops A boon for OEMs and suppliers has been the steady the list with EBITDA of US$42 billion, for the 12 months increase in production/sales volumes over the last three Cto June 30, 2016. years. Production has gone from 16.6 million units during Top 10 Transactions: 2016 $CAD millions Valuation Multiples

Country of EV/LTM EV/LTM Target Acquirer Closed Date EV Target Sales EBITDA Daihatsu Motor Co. Ltd. Toyota Motor Corporation Japan 27-Jul-16 9,569 0.5x 4.0x GETRAG Getriebe-und Zahnradfabrik Hermann Hagenmeyer GmbH & Cie KG Magna International Inc. Germany 04-Jan-16 3,455 1.4x – Affinia Group Holdings Inc. Mann + Hummel Holding GmbH United States 04-May-16 1,749 – – Key Safety Systems, Inc. Ningbo Joyson Electronic Corp. United States 02-Jun-16 1,291 – – Montupet SA Linamar Corp. France 18-Jan-16 1,233 1.7x 9.1x AFX Industries L.L.C. Exco Technologies Limited United States 05-Apr-16 107 – – General Cable Corporation, Automotive Ignition Wire Business Standard Motor Products Inc. United States 27-May-16 93 0.7x – Fuel Systems Solutions, Inc. Westport Innovations Inc. (nka: Westport Fuel Systems Inc.) United States 01-Jun-16 68 0.2x (6.1)x Spectra Premium Industries Inc. Caisse de dépôt et placement du Québec; Fondaction Canada 19-Apr-16 55 – – Laydon Composites Ltd. WABCO Holdings Inc. Canada 15-Apr-16 40 1.6x – Source: Capital IQ, as of September 30, 2016.

Automotive EV/ LTM EBITDA, 2013-2016 Source: Capital IQ, as of September 30, 2016.

34  www.apma.ca Winter 2017 Monthly Production Volumes: North America, 2013-2016 Source: Capital IQ, as of September 30, 2016.

the 12 months to August 2014, to 17.3 mil- lion and 17.8 million for the subsequent 12 month periods to August 2016. The aging car park, technological chang- es, light-weighting, and alternate drivetrains are expected to continue to spur production as OEMs enjoy one of the most robust peri- ods of automotive innovation over the last three decades. As such, earnings multiples generally reflect this new age of automotive production. Source: Capital IQ, as of September 30, 2016. ■

© 2016 KPMG LLP, a Canadian limited liability part- nership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International.

The Automotive Parts Manufacturers’ Association  35 supported by the Province of Ontario CANADA’S AUTO INDUSTRY What’s Now? What’s Next? Are You Ready? Don’t miss the first Automotive News Canada Congress during the opening days of the Canadian International AutoShow – O Canada event aimed at attracting industry professionals from all facets within the Canadian automotive sector. Metro Toronto Convention Centre Toronto, Ontario | February 16-17, 2017

The Automotive Parts Manufactur- hear from professional industry speakers, • Michael Robinet, Managing Director, ers’ Association and Automotive News including: Automotive Advisory Services, IHS Canada are teaming up to produce the • Andy Palmer, CEO, Aston Martin Markit first annual Automotive News Canada Lagonda • Senior Government Speakers Congress, which will feature top speak- • Daniel Weissland, President and Sponsorship provides a superb oppor- ers covering vital issues facing the CEO, Audi Canada tunity to show support for a strong and Canadian auto industry. The country’s • Don Walker, CEO, Magna vibrant Canadian automotive industry top automakers, suppliers and dealers International while promoting brand awareness and will discuss the sales outlook for 2017, • Jerry Dias, National President, Unifor recognition among industry executives, technology and mobility solutions, and • Joe Eberhard, President and CEO, colleagues and government stakeholders. investments in a more prosperous Cana- Jaguar Land Rover North America To learn more about the sponsorship dian market. • Joni Paiva, President, Nissan Canada opportunities available, please contact The event is expecting 800 key indus- • Mark Buzzell, CEO, Ford of Canada Vincent Guglielmo, APMA, at (416) 620- try executives and suppliers, who will • Peter Hall, Chief Economist, EDC 4220, ext. 233 or [email protected].

Platinum Sponsor Silver Sponsors Bronze Sponsors

AutomotiveNews.ca/CanadaCongress | Register Today!

36  www.apma.ca Winter 2017 Don’t Miss the Inaugural AIAG Automotive Quality Summit!

Fuebr ary 16, 2017 |Toronto, ON

The Automotive Parts Manufacturers’ Association (APMA) and the Automotive Industry Action Group (AIAG) are teaming up to produce an Automotive Quality Summit for the Canadian industry as part of the 2017 AutoShow – O Canada! Industry Day, which will be held in Toronto, ON in February 2017. The inaugural Industry Day at AutoShow 2017 will attract industry professionals from the vari- ous automotive manufacturing segments within the Canadian automotive sector. It is designed to showcase the Canadian supplier industry’s commitment to world-class quality and is the first event between APMA and AIAG’s new collaborative working agreement. This half-day event will include sessions focused on new industry global quality standards and highlight supplier compliance expectations and timing.

The agenda will feature: • An automotive standards update from the International Automotive Task Force (IATF) • A certification rules update from the International Automotive Oversight Bureau (IAOB) • Transition timing and supplier Support information

Sponsorship opportunities are available to showcase your company’s brand, alignment and support for automotive quality excellence. To learn more about sponsorship opportunities or to see agenda and registration information, go to www.apma.ca/automotive-quality-summit-february-16-2017.

The Automotive Parts Manufacturers’ Association  37 in every issue Leading, Reaching & Connecting 2017 APMA Highlights

October 2016 evening of networking, to hear from a senior automotive execu- Automotive Supplier Competitiveness Improvement tive, and to strengthen the automotive industry in the Great Lakes Program (ASCIP) Region.

February 16-17, 2017 Automotive News Canada Congress in partnership with APMA

The Automotive Parts Manufacturers’ Association (APMA) was pleased to announce the launch of an exciting new program aimed at helping to turn the ignition on new opportunities in the vital automotive sector of the Ontario economy. The Automotive Supplier Competitiveness Improvement Pro- gram (ASCIP) will support the improvement of auto parts sup- plier capabilities and competitiveness by increasing their ability to design and deliver products more efficiently. ASCIP is a partnership between APMA, the Ministry of Eco- APMA and Automotive News Canada are teaming up to pro- nomic Development and Growth (MEDG), and the Ontario Cen- duce the first annual Automotive News Canada Congress as part tres of Excellence (OCE). APMA will drive industry outreach and of the 2017 AutoShow – O Canada! event aimed at attracting program uptake across its membership and the broader sector, industry professionals from all facets within the Canadian auto- deliver marketing and promotional activities, work with applicants motive sector. The event will attract approximately 800 key indus- to develop project business plans, complete and submit applica- try executives and suppliers. tions, and provide program support. The OCE will administer and manage the jointly branded program, including application intake, Fyebruar 16, 2017 review, contracting, funding disbursement, and reporting. AAIG partners with APMA to produce the 2017 Canadian Automotive Quality Summit Fyebruar 2017 Canada-U.S. Automotive Dinner

This event is a collaboration between APMA and Automotive Industry Action group (AIAG) showcasing the Canadian Automo- tive Industry’s commitment to World-Class Quality. The agenda will focus on the new industry global quality standards roll-out, Canadian supplier compliance expectations and timing.

Ralph V. Gilles, Head of Design, FCA – Global addressing audience members at the Canada-U.S. Automotive Dinner. APMA partners with AAIG to benefit members APMA has partnered with the Automotive Industry Action The APMA and OESA will host the 29th Annual Canada-U.S. Group (AIAG) to offer FREE, unlimited access to knowledge Automotive Dinner in later February 2017 in cooperation with the assessments, training, standards and best practices in the areas of Consul General of Canada – Detroit. The event annually attracts quality, materials management and sustainability. Current APMA key industry executives from Canada and the United States for an members with annual global sales revenue under $20 million may

38  www.apma.ca Winter 2017 The Canadian Pavilion at the IZB Trade Fair 2016 in Wolfsburg, Germany. qualify for free AIAG membership, (up to the impact of a trade deal between China competitiveness issues, trade and regula- a $1,000 value). and NAFTA countries, and what such a tory factors affecting the industry, which negotiation could mean for the automo- was followed by a question-and-answer September 28, 2016 tive industry. session. APMA visits Washington to discuss trade October 17, 2016 / November October 17-20, 2016 APMA led a delegation to Washing- 22, 2016 Canadian Pavilion at IZB Trade Fair in ton, DC to meet with elected legislators APMA addresses Government of Wolfsburg, Germany to discuss trade-related matters focus- Canada Industry Committee APMA lead a Canadian Pavilion with ing on the Trans-Pacific Partnership and In Ottawa, ON, Flavio Volpe, APMA’s the support of the Governments of Can- the North American Free Trade Agree- president, addressed government MPs ada and Ontario to the IZB Trade Fair in ment and the impacts to the Canadian on behalf of Canadian automotive com- Wolfsburg, Germany on the footsteps automotive industry. While there, Fla- ponent suppliers. Flavio addressed of Volkswagen’s world headquarters vio Volpe also addressed the influential Parliamentarians, providing an overview with 13 Canadian companies and orga- Global Business Dialogue (GBD) at the of the state of the industry in Canada and nizations joining the pavilion, promoting National Press Club, sharing his views on addressed advanced manufacturing and Canadian innovation and capabilities. ■

The Automotive Parts Manufacturers’ Association  39 Please join us in welcoming the following companies as new members of the APMA. We in every issue salute these new members, along with all of our faithful existing members, who continue to provide us with their support. Meet APMA’s Newest Members REGULAR MEMBERS Sciemetric Instruments, Inc. ETAS Embedded Systems Canada Applied Precision Inc. 359 Terry Fox Drive, Suite 100 51 Breithaupt Street, Suite 100 6150 Kennedy Road, Unit 8 Kanata, ON K2K 2E7 Kitchener, ON N2H 5G5 Mississauga, ON L5T 2J4 Representative: Linda Moran, Director of Marketing Representative: Rob Lambert, Principal Security Consultant Representative: Robert Bell, President Alternate: Mathew Daniel, Vice-President of Operations Alternate: Dave MacFarlane, General Manager Alternate: John Lazenkas, Manager of Technical Services T el: (613) 254-7054 T el: (519) 804-9235 T el: (905) 501-9988 Fax: (613) 254-5313 E-mail: [email protected] Fax: (905) 501-9288 E-mail: [email protected] www.etas.com E-mail: [email protected] www.sciemetric.com Products: Car and heavy vehicle security, design and risk www.appliedprecision.ca Products: Sciemetric products and technology enable assessments, vehicle to vehicle consulting, and intrusion Products: 3-D digitizing inspection, 3-D design software, manufacturers to meet their production goals. From reducing detection systems for vehicles. 3-D inspection software, CT inspection services, 3-D costs, to improving manufacturing quality, to meeting yield printing, reverse engineering to capture hand modifications targets, our customers receive measurable value from JIT Automation Inc. to stamping dies, plant layout digitizing, competitor part and our solutions. Applying experience that spans decades 1-1744 Midland Avenue assembly analysis. and thousands of production lines, Sciemetric is uniquely Toronto, ON M1P 3C2 positioned to provide insight into manufacturing processes Representative: Matt Matsunaga, Vice-President & General Canadian Centre for Product Validation across the entire plant. Our goal is to help manufacturers Manager 2555 Bonder Road make it right the first time. Alternate: Steve Chen, Vice-President of Engineering London, ON N6M 0E7 T el: (905) 948-8525 Representative: John Makaran, Director SHW Pumps & Engine Components Inc. Fax: (905) 948-0555 Alternate: Stanley Carr, Business Development Manager 175 Sun Pac Boulevard, Unit #4 E-mail: [email protected] T el: (519) 452-6901 Brampton, ON L6S 5Z6 www.jitautomation.com Fax: (844) 519-2278 Representative: Peter Krug, Managing Director Products: Distribution and repair of quick die change systems. E-mail: [email protected] T el: (905) 790-0999 www.ccpv.ca Fax: (905) 790-2417 Pegasystems Products: Performance product validation (PV), mechanical E-mail: [email protected] 1 Rogers Street PV, electrical PV, environmental PV, thermal PV, CFD simulation, www.shw.de Cambridge, MA, USA 02142 DFMEA, FMA, and design review/design validation. Products: Design and development of oil pumps; prototype Representative: Sreedhar Jayanthi, Senior Account build pumps and testing; engine oil pumps; transmission oil Executive F&P Manufacturing, Inc. pumps; vacuum pumps; and balance shaft modules, including Alternate: Jon Eickhorst, Senior Director of Sales P.O. Box 4000 pumps. T el: (647) 825-2025 1 Nolan Road Fax: (617) 374-9620 Tottenham, ON L0G 1W0 Swift Components Corporation E-mail: [email protected] Representative: Andrew Kochanek, President 280 Holiday Inn Drive, Unit #2 www.pega.com Alternate: Kiyoshi Horiuchi, Director Cambridge, ON N3C 1Z4 Products: Pegasystems enables strategic applications T el: (905) 936-3435 Representative: Kristen Danson, Managing Partner that evolve to meet changing business needs while driving Fax: (905) 936-4809 Alternate: Sheldon Rier, Managing Partner competitive advantages. Pega’s applications streamline critical www.fandpmfg.com T el: (519) 740-3880 business operations, connect enterprises to their customers Products: Sub-frames, Suspension arms, modular suspension Fax: (519) 620-1701 seamlessly in real-time across channels, and adapt to meet assemblies, pedal assemblies, stampings, and cold forge. E-mail: [email protected] rapidly changing requirements. Pega’s Global 2000 customers www.swift-co.com include the world’s largest and most sophisticated enterprises. HOERBIGER FineStamping Inc. Products: Hood insulators (Rav 4, Corolla, and Lexus). 555 Parkside Drive Sanyo Corporation of America Waterloo, ON N2L 5E7 ASSOCIATE MEMBERS 26200 Town Center Drive, Suite 180 Representative: Wayne Eadie, General Manager & President Advanced Technology Emission Solutions Inc. Novi, MI, USA 48375 Alternate: Jay Church, Engineering Manager McMaster Automotive Resource Centre Representative: Hiroshi Yoshida, Chief Coordinator T el: (519) 772-0951 200 Longwood Road South, Suite 224 Alternate: Naoki Ota, Chief Coordinator Fax: (519) 772-0956 Hamilton, ON L8P 0A6 T el: (734) 591-7257 E-mail: [email protected] Representative: Anthony Hardenne, President & CEO E-mail: [email protected] www.hoerbiger.com T el: (905) 580-2000 www.sanyocorp.com Products: Clutch plates, shims, steel discs, and pump plate. E-mail: [email protected] Products: Trading company deals automotive interior parts www.atesinc.ca mainly for Japanese OEMs / Tier 1 companies. Poitras Foundry Ltd. Products: Automotive clean air technology based on 168, boulevard Nilus-Leclerc electrically heating the catalyst in emission after treatment Waterloo Region Economic Development Corporation L’Islet, QC G0R 2C0 systems. The net benefit is significant reductions in cold start 260 King Street West, 2nd Floor Representative: Claude Masse, President and real driving emissions. Kitchener, ON N2G 1B6 Alternate: Russ Demeny, Vice-President of Sales Representative: Erin D’Alessandro, Director of Business T el: (418) 247-5041 Akka Technologies Development & Client Services Fax: (418) 247-7647 1 Dundas Street West, Suite 2500 Alternate: Tony LaMantia, President & CEO E-mail: [email protected] Toronto, ON M5G 1Z3 T el: (519) 747-2541 www.poitrasfoundry.com Representative: Arnaud Grienay, Business Manager E-mail: erin.d’[email protected] Products: Drive train castings. Alternate: Fernando Ledesma, Corporate Director www.wredc.ca T el: (647) 361-4224 Products: WREDC is a not-for-profit, independent organization E-mail: [email protected] that fosters, supports and helps deliver a coordinated and www.akka-technologies.com integrated approach to economic development in the Waterloo Products: Engineering services—Akka Technologies is the Region. European market leader for full vehicle projects or specific stages, modules, components or parts including autonomous vehicles, powertrain systems, testing, manufacturing engineering, cost engineering and weight savings.

40  www.apma.ca Winter 2017 Meet APMA’s Members ABC Group Natural Resources Canada Samuel Automotive, a Division of Samuel, Son & Co. Toronto-Dominion Bank (The) Advanced Technology Emission Solutions Inc. Niagara Region – Economic Development Sanyo Corporation of America Toyota Tsusho Canada Inc. AGS Automotive Systems Offshore Group (The) Schukra of North America Ltd. TRQSS Inc. Akka Technologies Omega Tool Corp. Sciemetric Instruments, Inc. TrustPoint Innovation Technologies, Ltd. Alcohol Countermeasure Systems Corp. Ontario Centres of Excellence Seneca College of Applied Arts and Technology Tyco Electronics Canada ULC Almag Aluminum Inc. Optessa Inc. SEW Eurodrive Company of Canada Ltd. University of Waterloo – WatCAR Anchor Danly Papp Plastics & Distributing Ltd. SEWS Canada Ltd. University of Windsor Aon Reed Stenhouse Inc. Pegasystems Sherrard Kuzz LLP Valiant Corp. Applied Precision Inc. Phantom Intelligence Inc. SHW Pumps & Engine Components Inc. Velcro Canada Inc. ArcelorMittal Dofasco Hamilton Plex Systems Sightline Innovation Inc. Vimich Traffic Logistics Arent Fox LLP Poitras Foundry Ltd. Sinteris Inc. WALTER Surface Technologies AutoForecast Solutions LLC Pravala Network Inc. Sle-Co Plastics Inc. Waterloo Region Economic Development Corp. Automotive Centre of Excellence – UOIT PricewaterhouseCoopers LLP SME Wells Fargo Equipment FinanceWindsor Mold Balluff Canada Inc. Promexico Specialty Innovations and Manufacturing Group Banco BASE QNX Software Systems Ltd. (Maxtech Licensee Co.) WindsorEssex Economic Development Corp. BDC – Business Development Bank of Canada Racer Machinery International Inc. Studio 63 Inc. Woodbridge Group (The) Blake, Cassels & Graydon LLP Raufoss Automotive Components Canada G.P. Swift Components Corp. XYZ Interactive Technologies Inc. Böhler-Uddeholm Ltd. Revere Plastics Systems Tieling Tianhe Mechanical Manufacturing Co. Ltd. Zerust/Excor Corrosion Solutions Brakers Early Warning Systems Brave Control Solutions Inc. Brose Canada Inc. Canadian Centre for Product Validation CNPC POWDER North America Inc. Combined Metal Industries (CMI) Commercial Spring and Tool Company Ltd. Corporate Benefits Division D&V Electronics Ltd. DBG Canada Ltd. Deloitte Dickinson Wright LLP Dovercourt Management Corp. Dynaplas Ltd. Eagle Press & Equipment Co. Ltd. EASi Engineering Services EDC – Export Development Canada Entrada Group Epicor Software Corp. Ernst & Young LLP ETAS Embedded Systems Canada F&P Manufacturing, Inc. Festo Fraunhofer Project Centre for Composites Research G4 Apps Inc. Georgian College of Applied Arts & Technology Hematite Manufacturing Henkel Canada Corp. HOERBIGER FineStamping Inc. Houghton International HRSflow Intelligent Mechatronic Systems Inc., IMS International Sew-Right Invotek Electronics Inc. Italian Chamber of Commerce of Ontario JIT Automation Inc. Jobs Ohio KPMG LLP Lanex Manufacturing Inc. LeddarTech Linamar Corp. Linear Transfer Automation Inc. Litmus Automation Inc. Lixar London Economic Development Corp. M & R Automation Canada Inc. Magna International Inc. Martinrea International Inc. Marwood Metal Fabrication Ltd. Matcor-Matsu Group Inc. McMaster University Mentor Works Ltd. Metelix Products Inc. MetriCan Stamping Co. Inc. Miller Canfield Mitchell Plastics Mohawk College Municipality of Chatham-Kent Narmco Group (The) National Research Council of Canada (IMI)

The Automotive Parts Manufacturers’ Association  41 Meet CAMM’s Members The Automotive Parts Manufacturers’ Association (APMA) and the Canadian Association of Mold Makers (CAMM) have teamed up to offer members an even better member experience! Please join us in welcoming the following CAMM members. We salute them for their support.

Aalbers Tool & Mold Inc. Briadco Tool & Mould Inc. Collins Barrow Windsor LLP Expert Tool & Technologies Inc. Aarkel Tool & Die Inc. Build-A-Mold Ltd. Concours Mold Inc. FGL Precision Works Inc. Acetronic Industrial Controls Inc. Calframax Technologies Contents Processing Centre Finkl Steel Acrolab Ltd. Cana-Datum Moulds Ltd. Cottam Diecasting Ltd. HUB International Ontario Ltd. Active Burgess Mould and Design Canada Mold Technology Inc. Crest Mold Technology Inc. INCOE Corporation Advantage Engineering Canadian IPG Crystallume Injection Technologies Inc. AlphaKOR Group Canadian Metalworking DDS Software Solutions Integrity Tool and Mold Inc. Amerjy Tool and Mould Cap Thin Molds Delmo Molds Inc. Ives Insurance Brokers Ltd. Arlen Tool Company Ltd. Cavalier Tool & Manufacturing Ltd. DME of Canada Ltd. Jesse Garant & Associates Metrology Center Basic Tool Inc. CB Mould Services DMS (Canada) Ltd. KLG Molds BDO Canada LLP Cimatron Technologies Inc. Dynamic Metal Treating, Inc. Laurentian Bank of Canada Blow Mold Tooling Inc. Circle 5 Tool & Mold Inc. Ellwood Specialty Metals Laval International BORIDE Engineered Abrasives Clinton Aluminum Canada ULC Enterprise Mold Ltd. Leemark Enterprises Machine Tool Solutions Ltd. Mega Mold International Inc. Metric Mold (1983) Inc. Mold-Spec Inc. Mold-Tech Canada Nova Tool & Mold Inc. Paroian Skipper Hewitt PBL Insurance Ltd. PCS Company Plasman Group Platinum Tool Technologies Inc. Priority Tooling Solutions Progressive Components Redoe Mold Company Ltd. Rocand Inc. Rosati Group Runipsys North America Russell A. Farrow Ltd. Schmolz+Bickenbach Canada Inc. Sorel Forge Inc. Spartan Sling Manufacturing SPM Automation (Canada) Inc. SST Canada St. Clair College of Applied Arts & Technology Sturdell Industries Inc. Superior Tool & Mold Inc. Technical Management Consultants Inc. Tool-Plas Systems Inc. Topbin Insurance Solutions Toshiba Machine Company Canada Ltd. TST Tooling Software Technology Unique Tool & Gauge Inc. Vox ISM Inc.

Take Advantage of our Referral Program To serve our industry better, APMA and CAMM are seeking (and rewarding) your assistance in obtaining new members! If your company is a current member of APMA/CAMM and you refer a new manufacturing member who joins the association(s), you will both receive a discount on your membership! This results in APMA and CAMM serving a higher volume of companies throughout the industry and presents additional networking opportunities for our members. It’s a win-win! Go to www.apma.ca to learn more.

42  www.apma.ca Winter 2017 in every issue

BEHIND THE WHEEL Behind the Wheel of the All-New 2017 Honda Ridgeline

he completely redesigned 2017 Honda cabin quietness. With available Honda Sensing safety Ridgeline powered its way into the U.S. and driver-assistive technology, it is anticipated to mid-size pick-up market with a long list of earn top-of-the-class collision safety ratings. T new features and improvements to deliver For the first time, both two-wheel-drive and all- an unprecedented combination of cargo- and peo- wheel-drive options are available and there is an ple-hauling capability and sophistication in the mid- expanded array of standard and available premium size pick-up class. Boasting unsurpassed dynamic features and technologies, including a new eight- refinement and extensive comfort and convenience inch display audio touchscreen with Android Auto™ features, the 2017 Honda Ridgeline also has the and Apple CarPlay™ compatibility and new genera- most spacious and versatile interior and highest tion of Honda Satellite-Linked Navigation System™. A available payload capacity in its class. wide array of new standard and available equipment The second generation of Honda’s innovative mid- includes tri-zone automatic climate control, push-but- size pick-up truck, the 2017 Ridgeline is redesigned to ton start, remote engine start, smart entry, a power offer both recreational and work users a higher degree sliding rear window, LED exterior and interior lighting of utility and versatility in a modern and rugged, yet and more. sophisticated midsize pick-up with the largest and The second-generation Ridgeline was designed most flexible cabin in its class. In addition, Ridgeline and developed and is manufactured in America using boasts a higher level of confident, refined dynamic domestic and globally-sourced parts. The Ridgeline’s performance as well as robust cargo-hauling and tow- exterior and interior designs were created by Honda ing capabilities, including a class-leading maximum R&D Americas in its Los Angeles design studio, while 1,584-pound payload capacity (varies by trim) and up vehicle development was undertaken at the compa- to 5,000-pound towing (RT AWD). ny’s Raymond, OH development center. Honda Man- Using a highly rigid, aerodynamic and tightly sealed ufacturing of Alabama in Lincoln, AL, is the exclusive unitized body construction, which delivers up to three manufacturing home of the 2017 Honda Ridgeline. times the torsional rigidity of competing body-on- frame trucks, Ridgeline also features Honda’s next- Premium style and features generation Advanced Compatibility Engineering™ The Ridgeline sports a sleek, sophisticated and rug- (ACE™) body structure and fully independent front ged exterior design, incorporating premium features and rear suspension systems with Amplitude Reactive including standard LED taillights and available features Dampers. The vehicle offers vastly superior ride com- such as LED projector headlights and LED daytime run- fort and handling precision, along with the top-in-class ning lights. continued on 44

The Automotive Parts Manufacturers’ Association  43 in every issueBehind the Wheel of the 2017 Honda Ridgeline

Inside, designers have applied high- bottoms folded up, has the capacity to carry and is the only bed in the midsize class that quality, soft-touch materials throughout the bulky items, like a 55-inch flat screen tele- can flat haul four-foot-wide items, such cabin and added thoughtful details like LED vision or a mountain bike with the wheels as drywall or plywood panels on the floor map lighting. Additional high-end amenities intact. Exclusive in its class, the Ridgeline’s between the wheel wells. include a standard 4.2-inch colour display, large under-seat storage area can carry long The bed also boasts numerous Honda- available heated front seats and a heated items with the rear seats folded down. exclusive features and capabilities, includ- steering wheel. All models also come stan- ing a highly versatile Dual-Action Tailgate, dard with a Class III towing hitch and AWD Innovative and versatile pick-up bed a redesigned In-Bed Trunk with fully flat modes add a seven-pin wiring connector. The new UV-stabilized, ultra high- floor and an available world’s first Truck Bed The Ridgeline’s 60/40-split and fold- strength glass fibre-reinforced SMC com- Audio System, making this new Ridgeline ing rear seat offers roomy seating for up posite bed is longer (+3.9 inches) and wider the ultimate tailgating vehicle. to three passengers and, with the seat (+5.5 inches) than in the previous model An available 115V AC in-bed power outlet with up to 400-watt charging (with engine running) and eight standard 350- pound tie-down cleats complete the Ridge- line’s capable and versatile bed design. The dent- and scratch-resistant bed construc- tion is designed for rugged daily use and does not require the protection of a bed liner like conventional steel or aluminum beds.

Advanced Powertrain and All-Wheel- Drive Technology The Ridgeline is powered by a new 3.5- litre direct-injected SOHC i-VTEC™ V-6 engine with Variable Cylinder Manage- ment™ (VCM™) mated to a wide ratio six- speed automatic transmission. Peak engine output of 280 horsepower (+30HP over the previous model) and 262 pounds per foot of torque (+15 pounds per foot), along with a 78-pound average reduction in curb weight and a more aerodynamically efficient exte- rior design, combine to deliver the quickest 0-60 mph acceleration and receive the high- est EPA fuel-economy ratings in the midsize pick-up truck class. All-wheel-drive models use Honda’s newest and most advanced AWD technol- ogy – Intelligent Variable Torque Manage- ment™ (i-VTM4). This entirely more capable system offers reduced weight, improved all-weather traction and enhanced dynamic handling capability. Honda i-VTM4 progres- sively distributes optimum torque between the front and rear axles and dynamically distributes engine torque between the left and right rear wheels, with the capacity to overdrive the outside rear wheel by 2.7 per cent to create a yaw moment that improves cornering precision.

Intelligent traction management A button-operated Intelligent Trac- tion Management System offers different

44  www.apma.ca Winter 2017 operating modes: normal, snow, mud and It can also be equipped with a newly the Institute’s rigorous small overlap frontal sand for AWD models, and normal and snow designed Honda Satellite-Linked Naviga- collision test. for 2WD versions. Developed, tuned and tion System™ featuring improved graphics Honda Sensing is the most comprehen- tested in challenging environments around and new capabilities, including 3-D ren- sive suite of advanced safety and driver- the world, the Intelligent Traction Manage- derings of terrain, buildings and road signs, assistive features available in the midsize ment system allows the driver to select the improved lane guidance, live search function pick-up truck segment and includes Col- operating mode that best suits the driving and more. Additional standard and available lision Mitigation Braking System™, Lane conditions by simply pushing a button on technologies include HD Radio, SiriusXM Departure Warning, Forward Collision the vehicle’s center console. Based on the 2.0 and up to four USB ports including two Warning, Lane Keeping Assist System, setting selected, the system adjusts the with 2.5-amp charging capability. Road Departure Mitigation and Adaptive drive-by-wire throttle map, transmission Cruise Control. Depending on trim, it can shift map, Vehicle Stability Assist™ engage- Advanced safety performance also be equipped with Honda LaneWatch™, ment and i-VTM4 torque distribution (for Using Honda’s second-generation Rear Cross Traffic Monitor and a blind spot AWD-equipped models) for optimal perfor- Advanced Compatibility Engineering™ information system. All Ridgelines come mance in a variety of surface conditions. (ACE™) body structure and “three-bone” equipped with a multi-angle rearview front floor construction, along with camera. Advanced technology advanced supplemental restraint systems Standard safety features include four- The Ridgeline delivers the most and available Honda Sensing™ safety and channel anti-lock brakes with brake assist advanced technology and connectivity driver-assistive technologies, the Ridgeline and hill start assist; vehicle stability assist that Honda has to offer, including an avail- targets the highest available crash safety with traction control; trailer stability assist; able eight-inch capacitive touchscreen dis- ratings from the National Highway Traf- agile handling assist; dual-stage, multiple- play audio connectivity interface with both fic Safety Administration (NHTSA) and threshold front airbags, driver and front Apple CarPlay™ and Android Auto™ com- the Insurance Institute for Highway Safety passenger side airbags and side-curtain air- patibility for seamless integration of com- (IIHS), including a 5-star Overall Vehicle bags for all outboard seating positions; and patible smartphone features and functions, Score in the NHTSA’s New Car Assessment a new tire pressure monitoring System with including smartphone-powered navigation Program (NCAP) and a TOP SAFETY PICK+ real-time display of individual tire pres- capabilities. score from the IIHS and a GOOD rating in sures. ■

The Automotive Parts Manufacturers’ Association  45 in every issue Service Excellence: APMA’s Three-Pillar Approach The APMA’s mission is to grow and promote a vibrant and globally for the worldwide automotive industry—an industry whose shipment competitive Canadian automotive supply chain. APMA members are value is $25 billion and directly employs over 80,000 people. engaged, recognized and act as a central partner in helping to build our Its more than 240 members account for 90 per cent of parts produc- country’s economic future. tion in Canada, including machines, and tool, die and mould makers. We do this through: Members represent all Tier levels, technology providers and compo- • Establishing meaningful contact between suppliers and customers; nent types, with many of the largest and most qualified suppliers and • Championing the cause of our members to all levels of government; technology companies. • Raising public awareness of issues important to our membership; and The APMA has a three-pillar approach to providing service excel- • Bringing forward trade and export initiatives with an OEM focus in lence: advocacy, industry intelligence, and broadening opportunities. ■ NAFTA countries, the European Union, India and China. The APMA is Canada’s largest and most influential association, repre- To learn more or to join APMA, contact Nadia Nincevic, APMA’s director of stakeholder rela- senting OEM producers of parts, equipment, tools, supplies and services tions and corporate membership, at (416) 620-4220, ext. 224 or [email protected].

Advocacy advances member organizations Industry intelligence provides intel Membership broadens opportunities by through productive and influential dialogues on government priorities and objec- offering impressive industry and network- with all levels of government leadership and tives and makes market intelligence ing events with relevant keynotes, industry North American industry leaders. The asso- accessible through APMA’s searchable executives and key government officials. ciation acts collaboratively with its member- industry database. It also delivers and APMA also facilitates supplier and tech- ship to address common issues and concerns connects members to financial pro- nology forums to showcase automotive through APMA Committees and Working grams, cost containment and savings capabilities, enhance the supply base and Groups. opportunities. develop new business.

46  www.apma.ca Winter 2017 Material Handling Specialty Section

The Automotive Parts Manufacturers’ Association  47 Logistics Specialty Section

48  www.apma.ca Winter 2017 Logistics Specialty Section

The Automotive Parts Manufacturers’ Association  49 buyer’s guide Advertisers with this symbol beside their name are members of APMA. 3D Scanning & Printing Services Economic Development Optimal Intelligent Scheduling Neo-Matrix Technologies Inc...... 24 Windsor-Essex Economic Optessa Inc...... 33 Development Corp...... 26 Abrasives Plastic Tooling Solutions Boride Engineered Abrasives...... 21 Engineered Rubber Products Arlen Tool Co. Ltd...... 17 AirBoss of America...... 28 Adhesive Manufacturing Plastics Forming, Finishing & Assembly Jowat Canada Ltd...... 17 High-Performance Steel Applications Advanced Manufacturing Processors, Custom SSAB EMEA AB...... 16 SPM Automation...... IBC Automated Assembly Systems & Supplies Injection Mould Toolings, Plastic Assemblies Presses Centerline (Windsor) Ltd...... 13 Windsor Mold Group...... 28 Eagle Press & Equipment Co. Ltd...... 4 Aluminum Lightweight Suspension Injection Moulding & Assembly Protective Packaging Components Sle-Co Plastics Inc...... 25 Samuel Strapping Systems...... 41 Raufoss Technology...... 46 LIGHTWEIGHT INNOVATION PROTOTYPING & Testing Services Aluminum Material Manufacturer MatcorMatsu Group Inc...... 45 Canadian Centre for Product Alcan Aluminum/Rio Tinto Alcan...... 20 Validation...... 31, 33, 35 Logistics Assembly Modules & Fluid Management Buckland...... 49 QUALITY CONTROL Solutions Livingston International...... 48 Sciemetric Instruments, Inc...... 6 Martinrea International Inc...... 8 Machine Tools, Metal Process, Machinery & Risk Management Automotive Parts & Services Accessories Banco BASE...... 30 Magna International Inc...... OBC Index Corporation...... 28 Safety Clothing Blow Moulding & Plastic Parts Machinery Tools Supplier International Sew-Right...... 50 ABC Group...... 22 Elliott-Matsuura Canada Inc...... 18 SPECIALTY Parts Forming Business Advisors Material Handling Formnet Inc...... 12 Collins Barrow Windsor LLP...... 39 Fast Freight Forwarding...... 47 KW Materials Handling Inc...... 47 Structural Metal Stampings Canadian Premier Auto Show Narmco Group...... IFC Auto Show...... 3 Manitoulin Transport...... 47 Metal & Wire Forming Tool Monitoring Consulting & Training Techna-Tool Inc...... 42 GRT...... 35 Oriimec Corporation of America...... 44 Traffic Logistics Custom Moulders Metalworking Fluids Vimich Traffic Logistics...... 49 Dynaplas Ltd...... 24 Houghton International...... 8

50  www.apma.ca Winter 2017